Question: (3 marks) d. What are the risk implications for an investor for a returns series that exhibits fat tails? (3 marks) e. A price weighted

(3 marks) d. What are the risk implications for an investor

(3 marks) d. What are the risk implications for an investor for a returns series that exhibits fat tails? (3 marks) e. A price weighted index places more weight on stocks with a higher price, whilst a value weighted index places more weight on stocks with a higher market capitalization. Discuss. (3 marks) f. Price weighted indices have been criticized because they introduce a downward bias by reducing the weight of growing companies whose stock split. What does this mean and why does the underweighting occur? (3 marks) (3 marks) d. What are the risk implications for an investor for a returns series that exhibits fat tails? (3 marks) e. A price weighted index places more weight on stocks with a higher price, whilst a value weighted index places more weight on stocks with a higher market capitalization. Discuss. (3 marks) f. Price weighted indices have been criticized because they introduce a downward bias by reducing the weight of growing companies whose stock split. What does this mean and why does the underweighting occur

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